As millions of people have adapted the way of digital payments majorly in the form of UPI, there are many who are still stuck using the traditional method of keeping cash at home. However, as per the Government of India, there is a consequence of keeping large piles of cash stored at home.
The Amount of Cash You Can Stock at Home
So, as per Income Tax Department, there is no imposed limit on how much cash you are allowed to sock at home. But in case Income Tax raids your house then you must be able to show the source of that money. You must have track of your money and if the documents you are showing mismatch the final figure then Income Tax officials can penalise you. Furthermore, the excess cash, of which you do not have a written record, can be seized by the official and a fine of up to 137 per cent of that figure can be imposed on you.
How to Avoid Getting Penalised?
If you want to avoid getting penalised by the Income Tax Department then you must follow the provision rules by the Authority for stocking cash at home. For example- “no person is allowed to accept cash worth Rs 20,000 or more for any loan or deposit. This rule also applies to transfers of immovable property of the person. Cash transactions exceeding Rs 20 lakh in any financial year can attract a penalty only if they are unaccounted for and unsourced”, mentioned DNA India.
Furthermore, the Central Board of Direct Taxes made it mandatory for anyone who is depositing or borrowing ₹50,000 or more to provide a PAN Card. Also, the account holder will also have to provide both Aadhaar and PAN Card details if he or she is depositing ₹20 lacks or more in a financial year.
“Any Indian citizen may be subject to investigation by the investigating body if the sale or purchase of assets is paid for in cash in an amount greater than Rs 30 lakh. If a cardholder uses their credit or debit card to make more than one lakh rupees in a single transaction, there may be cause for investigation. Additionally, it is not possible to withdraw approximately Rs 2 lakh in cash from family members in a single day; instead, the transaction must be authorised by the bank,” further mentions.